A contingent liability is a financial obligation that is not certain but contingent on certain factors. An example of a contingent liability is a lawsuit that has been filed against a company or an individual. Until the suit is resolved, there is no certain amount the defendant is responsible for. The existence of contingent liabilities should be disclosed to insurance companies during the underwriting process.
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Contingent payee
Individual who receives life insurance proceeds that are still payable under a settlement option at the time of the primary payee’s death. Also called successor payee.
Contingent payment
Payment to be made only if a specific predesignated condition is met.
Contingent renewal privilege
Insurance policy provision that allows an insured to continue insurance coverage when specific conditions are fulfilled (e.g., continued full-time employment beyond age 65).
Contingent surplus note (CSN)
A form ofcontingent capital giving the (re)insurer the right to issue debt to investors or a bank if specified events take place although the arrangement may be unconditional. CSNs are equivalent to overdrafts and ensure the solvency of the (re)insurer in times of high claims.
Continuance tables
Record or schedule that shows morbidity statistics indicating the distribution of insurance claims categorized by duration of illness or amount of expense of the claims.
Continuation (Health Insurance)
A way for former employees to continue the health insurance they were covered under. The former employee must meet certain conditions.
Continuation clause
Institute Time Clause/International Hull Clause by which the vessel is held covered until arrival at her destination should she be at sea or a port of distress, at the time the policy expires. It rarely applies as the succeeding policy comes into operation immediately at the expiry date.
Continuation of coverage
Insurance coverage that remains even though an employee has a termination of employment or becomes divorced. Continuation of coverage is required by and specified in the Consolidated Omnibus Reconciliation Act of 1985 (COBRA) legislation.
Continuation of enrollment
Managed care plan option that allows an enrollee to continue in the Medicare+Choice plan when he or she leaves the plan’s service area to reside elsewhere, possibly permanently.